First Union Scrambles International Execs ButSays It's Not a Retreat

First Union Corp. has reshuffled senior management in its international unit as part of an effort to streamline operations and enter new businesses.

The reorganization-which makes First Union the third major banking company to overhaul international activities in recent months-calls for development of international capital market activities and a proprietary integrated payment and settlement system.

The Charlotte, N.C., company aims to trim its 71,000-person work force by 5% to 10% this year through layoffs and attrition. But Michael P. Heavener, an executive vice president who heads its international unit, said: "We are not backing away from any major initiatives.

"We are not doing anything that will compromise our international businesses," Mr. Heavener said. "We are not closing any overseas offices."

That stands in contrast to plans by two other large banks to refocus their international businesses.

Last month Bank One Corp. of Chicago announced it was shutting down its London trading operation in favor of building international trade finance, funds transfers, and cash management.

And late last year BankAmerica Corp., also of Charlotte, said it was getting out of retail banking in several Asian countries, reducing cross- border exposure, and focusing on corporate banking overseas.

First Union, meanwhile, is planning expansion-including entering the banknote business in competition with Republic New York Corp. and Credit Suisse Group, the two main providers of banknote services worldwide.

It is also beefing up the large international trade finance, payments, and global correspondent banking operation it inherited when it merged with Philadelphia-based CoreStates Financial Group early last year.

Mr. Heavener said a major objective of the reorganization will be to rationalize international operations spread across six locations-Charlotte, Philadelphia, Houston, Los Angeles, New York, and Miami.

He declined to tell how many jobs would be cut or confirm reports that a substantial number will be in the bank's Miami operations center. Proportionately, though, layoffs will be fewer in international operations than in other units, he said.

As part of the international reorganization, George M. Doolittle, senior vice president and general manager for Europe, is returning to the United States to head development of the bank's Gateway integrated payment and settlement system and global banknote operations.

Stephen Bash, senior vice president and general manger for Africa and the Middle East, will take over as head of European operations. Carlos Perez remains senior vice president in charge of Latin America in Miami, and the bank has combined management of North Asia and South Asia into a single unit under James Ho.

In related moves, Steven Nichols, deputy division head for trade, has been put in charge of a new team of trade finance experts who will move around the world to assist local relationship managers.

"Our customers are asking for increasingly complex solutions, and this goes well beyond what a relationship banker can handle," Mr. M. Heavener said. "This increases the talent we can apply to go after the biggest deals and provides much more depth in product knowledge."